Tag Archives: Tourism Business Council of South Africa

Tourism takes a massive knock at start of 2011

The results from the second measurement of the Tourism Business Council of South Africa’s/FNB’s new Tourism Business Index shows a dramatic fall in confidence amongst business leaders in the tourism and travel sector for the first three months of 2011, reports Business Day.

From a measurement of 89 % for the last quarter of 2010, the Index has dropped by a massive 10 percentage points to 79 %.  An Index of 100 % reflects normality, and any score above it would reflect a positive tourism scenario.  Particularly hard hit within the tourism industry is the Accommodation sector, the Index shows, reflecting not only oversupply but also poor demand. The Index is an indication of the current and likely future performance of businesses in the travel and tourism sector. 

The Tourism Business Index is a sad reflection of the state of affairs in tourism and hospitality, given the hosting of the world’s largest sporting event in our country less than a year ago, the World Cup having promised business for years to come.  The reality is that the world is still suffering the recession, and South Africa seems worse hit by it this year compared to any of the recession years since 2008.  The strong Rand and the ailing UK economy have been serious knocks to our tourism industry.

The current Easter weekend and extended holiday period due to a number of public holidays has been a welcome boost for the tourism industry, yet accommodation establishments have not been as fully booked as one would have expected for the 11-day stretch, demonstrating that times are tough for locals too.

The restaurant industry is showing early signs of hardship, ahead of the dreaded winter start next week, with restaurants closing down.  The latest restaurant to close is Hout Bay-based Wildwoods, owned by Pete Goffe-Wood, a chef who has operated for many years, and who has been an Eat Out  Top 10 Restaurant judge for a  number of years – he of all chefs should have been able to keep a restaurant going and make his restaurant a success.  So too Mezzaluna, Jardine, the Green Dolphin (which has been trading in the V&A Waterfront for more than 20 years), Blonde, Cheyne, and Liquorice and Lime on St George’s Mall have closed in the past few months.   In less than a year, about fifty restaurants have opened in Cape Town and the Winelands, and about 25 have closed their doors.  One of Cape Town’s oldest hotels, the Alphen Hotel, also recently closed its doors.  Restaurants are fighting back, and are offering specials, not just in winter, but many have done so throughout the past summer, the first time that the restaurant industry has done so.

With no special events lying ahead for winter in Cape Town, and only the Franschhoek events in May (Franschhoek Literary Festival), June (Cook Franschhoek), and July (Bastille), a long dreary winter is certain to lie ahead.  However, the report states that an Index score of 94 % is expected for the second quarter of 2011.   It is hoped that SA Tourism’s investment in a marketing campaign to encourage locals to travel in their own country will pay off, in stimulating domestic tourism, to improve matters not just for the tourism industry, but for the economy in general too, given the knock-on effect of tourism.  Tourism Minister Marthinus van Schalkwyk said recently that 79 % of all tourists travelling in the country are South Africans.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com  Twitter:@WhaleCottage

“Tourism still in doldrums”, say experts, and will be for rest of year

A newly launched TBCSA FNB Tourism Business Index shows conditions in tourism to still be depressed, and there is little confidence that trading conditions will improve for the rest of 2011, reports Business Day, with the headline “Tourism still in doldrums – new index”.

Initiated by the Tourism Business Council of South Africa, and sponsored by FNB, utilising the advisory services of tourism consultancy Grant Thornton, the Tourism Business Index was developed to “provide a clearer picture of the performance of the tourism industry for investors”.  “The index will keep the business community at large well informed on the current and likely future performance of the sector”, said Mmatsatsi Marobe, the CEO of the Tourism Business Council of South Africa.   Seventy tourism business leaders were polled in the last quarter of last year, in order to develop the index result.   

The first Tourism Business Index scored 89,4 %, and is expected to have a similar score for the second quarter of this year.  An index of 100 would signify ‘normal trading conditions’, signalling that the tourism ‘business environment is negative’, the report says.   The accommodation sector was particularly negative and depressed about future trading conditions.  The performance of the last quarter of 2010 was weaker than the two quarters preceding it, the Tourism Business Index showed, reports Southern African Tourism Update.

The Tourism Business Index is aimed at providing not only an update of business sentiment in the tourism industry, but also to position the tourism industry as an important sector of the economy, said Gillian Saunders of Grant Thornton, the consultant who vastly over-predicted the number of international visitors to South Africa during the World Cup.   FNB says its role is to help the tourism industry ‘become world class’.

From a research perspective, one hopes that the Tourism Business Index will expand its sample size, will include non-Tourism Business Council members, smaller accommodation establishments such as guest houses, and also will include more respondents from other tourism sub-sectors. 

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com  Twitter: @WhaleCottage

Tourism could reverse recession

Mmastsatsi Marobe, CEO of the Tourism Business Council, has said that tourism could be one way in which the South African economy can be stimulated, as reported in Travelwires.

She said that while individual accommodation establishments have seen a decline in occupancy, the IPL cricket and British and Irish Lions Rugby tours are good for the national economy, and demonstrated that South Africa is a viable destination for sport, business and leisure.

She identified a number of tourism trends that can stimulate the economy:

1.   Local tourism is on the up, at the expense of international tourism.  In the UK 20 % of British holidaymakers will travel in their own country this year.

2.   Going on holiday is a means of escapism from the doom and gloom of the effects of the credit crunch.   “Tourism provides a psychological lift to the psyche of the public”.

3.   Green is gold, in that tourists are becoming more discerning in expecting their accommodation to be environmentally responsible.

Marobe called for more young persons to be employed by the tourism industry, as they are the future of the tourism industry.

“…we all have a role to play in stimulating the economy through tourism – keep visiting, keep hosting, and keep investing” concluded Marobe.